A strong second-quarter earnings report has shares of Plug Power Inc (NASDAQ:PLUG) nearly 5% higher this morning at $6.14. Meanwhile, in the options pits, the stock's 30-day at-the-money implied volatility has plummeted 13.4% to a fresh annual low of 81.6%, while volume is running at five times the expected intraday level.

Most active by a healthy margin in PLUG's weekly 8/22 6.50-strike call, where more than 12,000 contracts are on the tape. There appears to be a mix of buy- and sell-to-open activity here, as traders gamble on the shares either to topple or top out at $6.50 by next's Friday's close, when the weekly series of options expires.

The volume-weighted average price (VWAP) for the calls is $0.28. Therefore, call buyers will profit at expiration if PLUG is settled above breakeven at $6.78 (strike plus VWAP). Gains are theoretically unlimited north of here, while the maximum risk is capped at the initial premium paid, should the contracts expire out of the money. By contrast, the call writers will retain 100% of the initial premium collected as long as PLUG remains at or below the strike through expiration, but they face potential assignment if the equity rallies past $6.78 between now and then, as well as theoretically unlimited losses.

Taking a step back, it's been a strong year for Plug Power Inc (NASDAQ:PLUG). The shares have nearly quadrupled in value in 2014, and have been ushered higher since mid-May by their 20-day moving average.